This most recent report solidifies the company's place as a top online marketplace for artisan sellers and smaller online merchants. E-commerce platforms should be looking to Etsy as a model for how to build boutiques focused on artisan goods with sustainable revenue.

Etsy's success in the second quarter of this year comes even as it faces heavy competition from Amazon. Capitalizing on Etsy's early success, Amazon launched its own artisan-only marketplace called Handmade at Amazon last summer. The e-commerce giant holds some clear advantages over Etsy, including its broad, global user base.

Most notably, merchants who sell on Handmade at Amazon are eligible to participate in Fulfillment by Amazon. Outsourcing logistics, shipping, and customer service to Amazon is a huge value to small merchants without their own fulfillment operations.

However, Amazon has likely seen more roadblocks in growing this marketplace than expected. In Amazon's Q2 2016 earnings report, no mention of Handmade at Amazon's performance was made. Furthermore, sellers have apparently been unhappy with the marketplace.

Last November, it was reported that sellers on Handmade at Amazon were seeing low engagement rates despite heavy promotion and prior success on other marketplaces. Etsy's promising Q2 performance could push Amazon to double down on its own handmade marketplace to maintain competitive footing in this space.